Sun | Aug 20, 2017

When will electric autos go mainstream?

Published:Sunday | October 2, 2016 | 10:00 AM
People look at the Mitsubishi eX Concept Electric Crossover at the Paris Auto Show in Paris, France, Friday, September 30, 2016. The Paris Auto Show gates are open to the public from Oct 1 to 16. (AP Photo/Michel Euler)
Dieter Zetsche, CEO of the Daimler AG, stands next to the Mercedes EQ concept car at the Paris Auto Show in Paris, France, Thursday, September 29, 2016. (AP Photo/Michel Euler)
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When will electric-powered cars become a practical choice for ordinary people?

The question hung in the air at the Paris auto show, where Volkswagen, Mercedes-Benz and General Motors are showing off electrics they hope are the on-ramp to a profitable future.

The raft of new vehicles lends buzz to electrics. But earlier over-optimistic predictions have also bred scepticism.

Volkswagen compared its ID electric compact to its historic Beetle and mainstay Golf models and said it was the leading edge of 30 new electric models it plans to put out by 2025.

Daimler AG CEO Dieter Zetsche looked more Silicon Valley than Stuttgart when he donned faded jeans and sneakers to tout the Mercedes-Benz EQ, a battery powered crossover SUV concept. The vehicle is meant to illustrate the company's longer term strategy that connects electric cars with other new technology such as autonomous driving and vehicle sharing.

Zetsche said the company aimed for 10 electric vehicles by 2025, making up 15-25 per cent of global sales - a bold prediction he immediately tempered by saying that was based on "continued development of infrastructure and customer preferences".

General Motors Company's European division Opel is showing off the Ampera-e, a rebadged version of the Chevrolet Bolt. Opel says the Ampera-e will achieve a range of more than 500 kilometres (310 miles) under European standards, a significant leap.

The Bolt goes on sale this year in the United States, but it's hardly cheap at the manufacturer's suggested retail price of US$37,495 for a five-seat hatchback. That's not counting the tax break of up to US$7,500 the federal government offers to encourage the growth of zero-emission vehicles.

For now, the limited range and higher costs mean battery-powered vehicles have little attraction for regular folks trying to get the most for their money. They remain largely a niche market, often for people enthusiastic about new technology or the environment, and with the extra disposable income to act on that. Palo Alto, California-based Tesla has won attention with rising sales of electrics to well-heeled customers - but loses money.

In the short run, at least, electric vehicles help burnish companies' image as technologically advanced and environmentally friendly. Volkswagen is struggling to recover from a scandal over diesel cars rigged to cheat on emissions tests.

But companies are also laying the groundwork for the day when the cost of electric falls to, or below, that of internal combustion. It's a day that some analysts think is only a few years off. When that happens, sales could hit a tipping point - a moment carmakers want to be ready for.

The arrival of such an 'E-day' could be accelerated by increasing government regulation mandating lower average emissions and higher mileage. Electrics in the product line-up would help carmakers meet new, lower European Union limits on greenhouse gas emissions blamed by scientists for global warming that go into effect in 2021. In the US, nine states have followed California in adopting a requirement that 15 per cent of new vehicles sales be zero-emission vehicles by 2025.

Electrics have good acceleration, and fewer moving parts to wear out. And imagine never stopping for gas, ever again.

But there are a host of other factors to consider: the price of gas; the price of electricity; charging times; battery costs; the ease with which you can find places to charge up.

Plug-in hybrids start on battery power, then use a small internal combustion engine to general electricity and extend the vehicle's range.

Pure hybrids like Toyota's Prius can't be plugged in and rely on the engine alone to charge the battery.

Bloomberg New Energy Finance issued a report in August that predicted electrics would match internal combustion vehicles in ownership costs in 2022, assuming oil prices of US$50-US$70 per barrel and battery prices of US$125 per kilowatt hour. That key cost has fallen from US$1,000 per kilowatt hour in 2010 to around US$350 per kilowatt hour today faster than many expected.

Thomas Turrentine, director of the Plug-In Hybrid and Electric Vehicle Research Center at the Institute of Transportation Studies at the University of California, Davis, says electrics will reach price parity "after 2020", but still might need some incentives to win over consumers.

He said the key will be the usual motive: "Once there's profit, you will see the car companies rush in and make more investments" in production.

Renault-Nissan CEO Carlos Ghosn says consumer choices can change, if the technology does. The company makes the Leaf battery-only electric.

"It's like with a smartphone - in the beginning you had eight hours charging for 30 minutes of discussion," Ghosn told the Associated Press. "Today it is the reverse. You need time for technology to do its job."